Medicaid Reform and Math-Challenged Reporters at the New York Times and Washington PostJune 28, 2017 by Dan Mitchell

Senate Republicans have produced their Obamacare repeal legislation, though as I noted at the end of this interview, it’s really more a bill about Medicaid reform than Obamacare repeal.

While it’s disappointing that big parts of Obamacare are left in place, it’s definitely true that Medicaid desperately needs reform, ideally by shifting the program to the states, thus replicating the success of welfare reform.

But critics are savaging this idea, implying that “deep cuts” will hurt the quality of care. Indeed, some of them are even engaging in poisonous rhetoric about people dying because of cutbacks.

There’s one small problem with the argument, however. Nobody is proposing to cut Medicaid. Republicans are merely proposing to limit annual spending increases. Yet this counts as a “cut” in the upside-down world of Washington budgeting.

The Washington Post contributes to innumeracy with a column explicitly designed to argue that the program is being cut.

…the Senate proposal includes significant cuts to Medicaid spending…the Senate bill is more reliant on Medicaid cuts than even the House bill…spending on the program would decline in 2026 by 26 percent…That’s a decrease of over $770 billion on Medicaid over the next 10 years. …By 2026, the federal government would cut 1 of every 4 dollars it spends on Medicaid.

An article in the New York Times has a remarkably inaccurate headline, which presumably isn’t the fault of reporters. Though the story has its share of dishonest rhetoric, especially in the first few paragraphs.

Senate Republicans…took a major step…, unveiling a bill to make deep cuts in Medicaid… The Senate measure…would also slice billions of dollars from Medicaid, a program that serves one in five Americans… The Senate bill would also cap overall federal spending on Medicaid: States would receive a per-beneficiary allotment of money. …State officials and health policy experts predict that many people would be dropped from Medicaid because states would not fill the fiscal hole left by the loss of federal money.

“Loss of federal money”?

I’d like to lose some money using that math. Here’s a chart showing the truth. The data come directly from the Congressional Budget Office.

At the risk of pointing out the obvious, it’s not a cut if spending rises from $393 billion to $464 billion.

Federal outlays on the program will climb by about 2 percent annually.

By the way, it’s perfectly fair for opponents to say that they want the program to grow faster in order to achieve different goals.

But they should be honest with numbers.

Now that we’ve addressed math, let’s close with a bit of policy.

The Wall Street Journal recently opined on the important goal of giving state policymakers the power and responsibility to manage the program. The bottom line is that recent waivers have been highly successful.

…center-right and even liberal states have spent more than a decade improving a program originally meant for poor women and children and the disabled. Even as ObamaCare changed Medicaid and exploded enrollment, these reforms are working… The modern era of Medicaid reform began in 2007, when Governor Mitch Daniels signed the Healthy Indiana Plan that introduced consumer-directed insurance options, including Health Savings Accounts (HSAs). Two years later, Rhode Island Governor Donald Carcieri applied for a Medicaid block grant that gives states a fixed sum of money in return for Washington’s regulatory forbearance. Both programs were designed to improve the incentives to manage costs and increase upward mobility so fewer people need Medicaid. Over the first three years, the Rhode Island waiver saved some $100 million in local funds and overall spending fell about $3 billion below the $12 billion cap. The fixed federal spending limit encouraged the state to innovate, such as reducing hospital admissions for chronic diseases or transitioning the frail elderly to community care from nursing homes. The waiver has continued to pay dividends under Democratic Governor Gina Raimondo. …This reform honor roll could continue: the 21 states that have moved more than 75% of all beneficiaries to managed care, Colorado’s pediatric “medical homes” program, Texas’s Medicaid waiver to devolve control to localities from the Austin bureaucracy.

By contrast, the current system is not successful.

It doesn’t even generate better health, notwithstanding hundreds of billions of dollars of annual spending.

Avik Roy explained this perverse result in Forbes back in 2013.

Piles of studies have shown that people on Medicaid have health outcomes that are no better, and often worse, than those with no insurance at all. …authors of the Oregon study published their updated, two-year results, finding that Medicaid “generated no significant improvement in measured physical health outcomes.” The result calls into question the $450 billion a year we spend on Medicaid… And all of that, despite the fact that the study had many biasing factors working in Medicaid’s favor: most notably, the fact that Oregon’s Medicaid program pays doctors better; and also that the Medicaid enrollees were sicker, and therefore more likely to benefit from medical care than the control arm.

In other words, I was understating things when I wrote above that there was “one small problem” with the left’s assertion about Medicaid cuts hurting people.

Yes, the fact that there are no actual cuts is a problem with that argument. But the second problem with the left’s argument is that Medicaid doesn’t seem to have any effect on health outcomes. So if Republicans actually did cut the program, it’s unclear how anybody would suffer (other than the fraudsters who bilk the program).

Once again, you help your opponents out tremendously. A very simple question, why are we discussing Medicaid( which is relegated to the poor) when our working class citizen can't afford regular health insurance? ....a question posed to the Republicans 10 years ago.

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I know how to bring out the buffoonery of A Trump supporter.State Fact

Are there any Fact-Checkers at the New York Times?October 19, 2012 by Dan Mitchell

On rare occasions, when I get really irked, I complain about media bias. Examples include this AP story on poverty, the Brian Ross Tea Party slur, this example of implicit bias by USA Today, and a Reuters report on job creation and so-called stimulus.

On other occasions, though, you stumble upon a news report or column that is ignorant beyond belief and you have to assume that the person has transcended ordinary bias and belongs in a special category.

The Washington Post seems to specialize in this kind of über-mistake. It was a Post reporter, after all, who wrote last year about a GOP plan to “slash” spending when timid GOPers were merely trying to trim 0.15 percent from the growth of federal spending. Not 15 percent. Not 1.5 percent. A mere $6 billion out of a bloated federal budget of $3,800,000,000,000.

And it was the Washington Post that decided to refer to a certain country as fiscally conservative. Was the reporter writing about Hong Kong or Singapore, the two jurisdictions with the smallest government and freest markets? Nope. Was the reporter referring to Switzerland, with its strong human rights policy on financial privacy, or Australia, with its personal retirement accounts? Nope, the reporter wrote about “fiscally conservative Germany.”

I guess the folks at the New York Times were feeling left out, because our latest example comes from that newspaper. Someone named Chrystia Freeland wrote an article about income inequality, making some decent points about cronyism, but also reflexively regurgitating talking points on class-warfare tax policy. What caught my eye, though, was this incredible assertion about government funding of education.

Educational attainment, which created the American middle class, is no longer rising. The super-elite lavishes unlimited resources on its children, while public schools are starved of funding. …elite education is increasingly available only to those already at the top. Bill Clinton and Barack Obama enrolled their daughters in an exclusive private school; I’ve done the same with mine.

So “public schools are starved of funding”? That’s a strong statement. It implies very deep reductions in the amount of money being diverted from taxpayers to the government schools. So where are the numbers?

You won’t be surprised to learn that Ms. Freeland doesn’t offer any evidence. And there’s a good reason for that. As show in this chart, government spending on education has skyrocketed in recent years.

This data isn’t adjusted for inflation or population, but you can peruse this amazing chart put together by one of Cato’s education experts to see that per-pupil spending has skyrocketed even after adjusting for inflation.

In other words, Ms. Freeland has no clue what she’s talking about. Or, to be fair, she made a giant-sized mistake, perhaps because she’s lives in a statist bubble and blindly assumes that left-wing politicians tell the truth.

Though I do want to giver her credit. She acknowledges that Obama and Clinton both decided to save their kids from a failed government-run school system, thus exposing some hypocrisy on the left. So it’s quite possible that she wanted to write a fair piece, but simply had a few major blind spots.

And it goes without saying that none of the editors or (non-existent?) fact checkers at the New York Times knew enough or cared enough to catch a huge blunder.

I see your game, you post something that is very irrelevant and awkward in logic and expect someone to counter. WRONG, all we need to do is observe, lets forget about CNN,MSNBC,FOX etc. Real time shows a president that has lost touch of reality. Where are the news conference reassuring Americans that he as a president will be there for you. Where are the phone calls telling Puerto Rico that we have your back, where is the comfort giving to the shooting victims in Texas over the weekend? I implore you, continue with the non sequential cartoons and memes, real-time and factual events are recording the actions of our current president and believe you me, no amount of your posts can blind intelligent people around the world to his impotent compassion and intellect. It's so easy to rebut and make your posting fake and lies due to one circumstance.......... Constant truth which reveals itself without the need of media.

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I know how to bring out the buffoonery of A Trump supporter.State Fact

Another Example of Editorial-Page Fiction at the New York TimesMay 13, 2013 by Dan Mitchell

Are there any fact checkers at the New York Times?

Since they’ve allowed some glaring mistakes by Paul Krugman (see here and here), I guess the answer is no.

But some mistakes are worse than others.

Consider a recent column by David Stuckler of Oxford and Sanjay Basu of Stanford. Entitled “How Austerity Kills,” it argues that budget cuts are causing needless deaths.

Here’s an excerpt that caught my eye.

Countries that slashed health and social protection budgets, like Greece, Italy and Spain, have seen starkly worse health outcomes than nations like Germany, Iceland and Sweden, which maintained their social safety nets and opted for stimulus over austerity.

The reason this grabbed my attention is that it was only 10 days ago that I posted some data from Professor Gurdgiev in Ireland showing that Sweden and Germany were among the tiny group of European nations that actually had reduced the burden of government spending.

Greece, Italy, and Spain, by contrast, are among those that increased the size of the public sector. So the argument presented in the New York Times is completely wrong. Indeed, it’s 100 percent wrong because Iceland (which Professor Gurdgiev didn’t measure since it’s not in the European Union) also has smaller government today than it did in the pre-crisis period.

But that’s just part of the problem with the Stuckler-Basu column. They want us to believe that “slashed” budgets and inadequate spending have caused “worse health outcomes” in nations such as Greece, Italy, and Spain, particularly when compared to Germany, Iceland, and Spain.

But if government spending is the key to good health, how do they explain away this OECD data, which shows that government is actually bigger in the three supposed “austerity” nations than it is in the three so-called “stimulus” countries.

NYT Austerity-Stimulus

Once again, Stuckler and Basu got caught with their pants down, making an argument that is contrary to easily retrievable facts.

But I guess this is business-as-usual at the New York Times. After all, this is the newspaper that’s been caught over and over again engaging in sloppy and/or inaccurate journalism.

Funny how I pay for a subscription to the Times while you can get free opinions on the dark web PATRIOTPOST.COM I'll put fact up to your paper....OHHH, I forgot, PATRIOTPOST is not a mainstream paper but is dedicated to those that hate government.....seeing that you must make up for lost time because of your work schedule...I would be mad as Hell that the government has me working beyond the normal retirement age...of course, let me digress because government gave you a tax cut thus allowing you the ability to stay home more often.

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I know how to bring out the buffoonery of A Trump supporter.State Fact

I sound a little materialistic Sir but in reality, materials won't buy you happiness. lets make a few comparison while you're here. I'm a Liberal that didn't vote for Trump nor Hillary, you voted for Trump yet he fails to put you on my playing field. Furthermore, lets forget the material gains and focus on life itself. I hear nothing in regard to your private or personal life,,,,,,, it's not what you say that's screaming reality for you..it's ALL which you attempt to avoid which screams your misfortunes in life. I actually fill sorry for you....I mean that with all sincerity.

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I know how to bring out the buffoonery of A Trump supporter.State Fact

Earth to New York Times: Please Show Us these “Deep Spending Cuts” You Keep Writing AboutFebruary 25, 2013 by Dan Mitchell

Sigh. I feel like a modern-day Sisyphus. Except I’m not pushing a rock up a hill, only to then watch it roll back down.

Compared to educating journalists about fiscal policy, this is an easy task

I have a far more frustrating job. I have to read the same nonsense day after day about “deep spending cuts” even though I keep explaining to journalists that a sequester merely means that spending climbs by $2.4 trillion over the next 10 years rather than $2.5 trillion.

The latest example comes from the New York Times, which just reported about “deep automatic spending cuts that will strike hard” without bothering to provide a single concrete number about spending levels in any fiscal year.

Yes, you read correctly. A story about budget cuts did not have any numbers for spending in FY2013, FY2014, or any other fiscal year.

So, for the umpteenth time, here are the actual numbers from the Congressional Budget Office showing what will happen to spending over the next 10 years if we have a sequester.

Sequester 2013

I don’t mean to pick on the New York Times. Yes, the self-styled paper of record has been guilty in the past of turning budget increases into spending cuts, but the Washington Post is guilty of the same sin, having actually written in 2011 that reducing a $3.8 trillion budget by $6 billion would “slash spending.”

And the NYT story actually has some decent reporting on how Republicans so far have (fingers crossed) avoided the tax-increase trap that Obama thought the sequester would create.

But one would still like to think that Journalism 101 teaches reporters to include a few hard facts when writing stories. Particularly if they’re going to use dramatic adjectives to describe what supposedly will happen.

Anyhow, this is just part of a larger problem. As I explained in these John Stossel and Judge Napolitano interviews, the politicians and interest groups have given us a budget process that assumes ever-increasing spending levels, which then allows them to make hysterical claims about “savage” and “draconian” cuts whenever spending doesn’t rise as fast as some hypothetical baseline.

This is why almost nobody understands that it’s actually relatively simple to balance the budget with a modest bit of spending restraint. My goal is reducing the burden of government spending, not fiscal balance, but it’s worth noting that we’d have a balanced budget in just 10 years if spending grew by “only” 3.4 percent annually.

I see your game, you post something that is very irrelevant and awkward in logic and expect someone to counter. WRONG, all we need to do is observe, lets forget about CNN,MSNBC,FOX etc. Real time shows a president that has lost touch of reality. Where are the news conference reassuring Americans that he as a president will be there for you. Where are the phone calls telling Puerto Rico that we have your back, where is the comfort giving to the shooting victims in Texas over the weekend? I implore you, continue with the non sequential cartoons and memes, real-time and factual events are recording the actions of our current president and believe you me, no amount of your posts can blind intelligent people around the world to his impotent compassion and intellect. It's so easy to rebut and make your posting fake and lies due to one circumstance.......... Constant truth which reveals itself without the need of media.

Funny, no article from the Washington post or financial pages of several reputable papers. You wonder why you're such a joke....COME ON MAN!!!!! make it hard for Ben and I to make you look uneducated. I feel a man taking candy from a little baby. It's even harder making Trump a good president....SO HARD!!!!! UPHILL BATTLE ARE YOUR FORTE

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I know how to bring out the buffoonery of A Trump supporter.State Fact

It’s Not April Fool’s Day, but New York Times Columnist Wants America to Become More Prosperous by Raising Taxes on the Middle Class and Becoming More Like ItalyAugust 17, 2012 by Dan Mitchell

Every so often, you read something so ridiculously stupid and absurd that you assume that you’re being pranked. So you look to the date of the article to see if it says April 1. Or you look at the Internet address to see if it’s a parody of a real website.

So when I read a column suggesting that the United States should become more like Italy, I thought this must be some sort of practical joke. After all, Italy is teetering on the edge of bankruptcy, kept afloat by bailouts and subsidies. Its economy is in the toilet, with pervasively high unemployment, almost no growth for a decade, and living standards that are only about two-thirds of U.S. levels.

The Italian government is also famously incompetent (naming the wrong people to high-level posts), with stifling levels of regulation, a dysfunctional fiscal system, and a corrupt legal system (and when it’s not crooked, it’s inane).

Notwithstanding all these crippling flaws, Italy has something akin to catnip for the left. It has a punitive tax burden, and that means it must be a nation worth emulating.

Here’s some of what Eduardo Porter wrote for the New York Times.

Italy may be in a funk, with a shrinking economy and a high unemployment rate, but the United States can learn a lot from it, and not just about the benefits of public health care. Italians live longer. Their poverty rate is much lower than ours. If they lose their jobs or suffer some other misfortune, they can turn to a more generous social safety net. …The reason is not difficult to figure out: rich though we are, we can’t afford the policies needed to improve our record. …But though the nation’s fiscal challenge has taken center stage in the presidential election campaign, raising more taxes from American families remains stubbornly off the table.

I’m willing to believe Italians live longer, but every other assertion in that passage is upside down. Yes, they have more subsidies for joblessness, but that’s one of the reasons they have higher unemployment (as even Paul Krugman and Larry Summers have acknowledged).

And the claim about less poverty is laughable. I’m guessing the author naively relied upon the slipshod analysis from the statists at the Organization for Economic Cooperation and Development. Those bureaucrats put together a moving-goalposts measure of income distribution and falsely categorized it as a tool for measuring poverty.

Setting aside these mistakes, the column is designed to convince people that we should give more money to Washington.

Citizens of most industrial countries have demanded more public services as they have become richer. And they have been by and large willing to pay more taxes to finance them. Since 1965, tax revenue raised by governments in the developed world have risen to 34 percent of their gross domestic product from 25 percent, on average. The big exception has been the United States. …the United States raises less tax revenue, as a share of the economy, than every other industrial country. No wonder we can’t afford to keep more children alive. In 2007, the most recent year for which figures are available, the United States government spent about 16 percent of its output on social programs — things like public health, food and housing for the poor. In Italy, that figure was 25 percent. …Every other industrial country has a national consumption tax, which can be used to raise a lot of money.

I will give the author credit. If you read the entire column, it’s clear he wants all Americans to pay higher taxes, not just the so-called rich. So at least he’s being honest, unlike a lot of statists (click here for a list of honest leftists who admit you can’t finance big government without screwing the middle class).

But honesty about goals doesn’t mean desirability of policy. If America becomes more like Italy, it will mean Italian-style stagnation and joblessness.

And it’s particularly worrisome to see that the author wants a value-added tax, which is a sure-fire way of giving politicians a big pile of money that will be used to expand the burden of government spending.

I have nothing against copying other nations, either when they get one policy right (such as Estonia’s flat tax or Australia’s system of personal retirement accounts), or when they get a bunch of policies right and routinely rank at the top for economic freedom and prosperity (such as Hong Kong and Singapore).

But I’m mystified by those who look at failure and conclude America should do likewise.

P.S. The Italians have a bad tax system, but they don’t meekly comply. Whether they’re firebombing tax offices or sailing yachts to other countries, they are a powerful example of the Laffer Curve insight that higher tax rates don’t necessarily translate into higher tax revenues.